The BBC's Elizabeth Blunt in Bamako"Not all the heads of state present agreed on how Africa has got itself into the present situation" real 28k

Tuesday, 20 February, 2001, 15:03 GMT

IMF policy comes under fire

World Bank's James Wolfensohn and IMF chief Horst Koehler

The International Monetary Fund and the World Bank are facing renewed criticism of their economic policies, despite claiming to have changed to meet the needs of the poor.

On the second day of development meetings with African leaders in Mali, leaders from the financial institutions faced the wrath of protesters claiming that the loans are doing more harm than good.

We are working with Africa very differently from the way in which we have worked with Africa in the past

Callisto MadavoWorld Bank

Banners outside the meetings claimed that the World Bank and International Monetary Fund (IMF) were assassinating African people, and causing poverty and catastrophe.

Although the views of protesters are extreme, leading aid organisations maintain the view that economic conditions imposed on developing countries by the IMF and World Bank can undermine the African domestic economy.

The debate is gaining in importance because decreasing aid and foreign investment is leaving African countries more reliant on IMF and World Bank hand outs.

Open ears

Despite the negative publicity, the World Bank and the IMF stressed ahead of the trip that they were changing their approach, and going to listen rather than to dictate to African nations.

It's very difficult to see what has changed apart from the language

Andrew Pendleton Christian Aid spokesman

"We are working with Africa very differently from the way in which we have worked with Africa in the past," said World Bank vice president for Africa Callisto Madavo.

"We are listening more. We are leaving the space to Africans to lead their own efforts, and it has become truly a partnership that is beginning to develop," added Mr Callisto.

The IMF and the World Bank have embarked on a formal process to include greater participation of civil society in policy making, countering criticism that the institutions are too close to the government and too remote from ordinary people.

"We will of course, offer some advice here and there, but the focal point will be on the heads of the state discussing amongst themselves and with us what the problems are and how they can be solved," said the IMF's director for Africa.

Perils of liberalisation

But although leading aid organisations such as Christian Aid welcome the changes, they also argue that the IMF and World Bank's basic framework policy of liberalisation, deregulation and privatisation remains unchanged.

"These policies can work, but in many cases they don't, " Mark Curtis, head of policy at Christian Aid, told BBC News Online.

Callisto Madavo says a partnership is developing

There are cases when forcing some of the world's poorest economies to compete in the global arena is disastrous.

"It's a kind of suicide," said Mr Curtis, explaining that developing countries should have the freedom to go against the policies of liberalisation if they need to.

Christian Aid says there are many cases where fledgling African industries are drowned by cheap imports because of enforced liberalisation.

Excess exports of poultry from the US or the EU are dumped onto Africa at subsidised prices, undermining local livelihoods and destroying local domestic industries.

With a liberalised economy, Africa is not allowed to protect itself from these sorts of cheap imports.

And Mozambique was forced to cut export tariffs on cashew nuts, a policy which put thousands of local people out of work.

The government lobbied the World Bank, and the bank eventually changed its policy to allow the tariff and protect the local industry.

World Bank president James Wolfensohn and IMF managing director Horst Koehler are in sub-Saharan Africa until 25 February, in a demonstration of support for the region.